While the current administration admits that the $25 billion in Recovery Act spending on infrastructure only created 150,000 jobs, it also stabilized and improved this nation’s productivity for years to come. Clean/green energy investments also come to mind, most of which require government funding and a government thrust in order to create millions of jobs. China knows this and is off and running. The U.S. needs to learn from their state-oriented model. In times of extremis, pushing on the private sector string is ineffective, especially within the context of a global marketplace that offers alternative investment locations. Government must temporarily assume a bigger, not a smaller, role in this economy, if only because other countries are dominating job creation with kick-start policies that eventually dominate global markets.

In the end, I hearken back to revered economist Hyman Minsky – a modern-day economic godfather who predicted the subprime crisis. “Big Government,” he wrote, should become the “employer of last resort” in a crisis, offering a job to anyone who wants one – for health care, street cleaning, or slum renovation. FDR had a program for it – the CCC, Civilian Conservation Corps, and Barack Obama can do the same. Economist David Rosenberg of Gluskin Sheff sums up my feelings rather well. “I’d have a shovel in the hands of the long-term unemployed from 8am to noon, and from 1pm to 5pm I’d have them studying algebra, physics, and geometry.” Deficits are important, but their immediate reduction can wait for a stronger economy and lower unemployment. Jobs are today’s and tomorrow’s immediate problem.

Comments

Holy crap. Someone is finally getting on the bandwagon. I am constantly on my conservative buddies about this. Remember CETA? I had a crew of malcontents on a road crew in the morning, then they had lunch and went to class for a few hours. (Actually, they weren’t bad guys, high school age, and I was in college. I knew their older siblings and their parents.)

So my rant is: “Would you rather they sat on their ass watching Oprah and reproducing, or would you rather see them work? They’re not stupid!”

Over the years, Gross has pretty consistently “talked his book” in public. His positions tend to reflect what’s good for his holdings. Which as of right now, contain no Treasury bonds. So now he wants the Federales to ramp up the debt issuance? Probably so that bond prices will go down to where he can buy for cheap again.